I'm Jonathan Aschoff, Senior Biotechnology Analyst at Roth MKM. With us now is Shankar Musunuri, the CEO of Ocugen. Hello, Shankar. Welcome.
Thank you. Thank you, Jonathan. Thank you for having me.
It's great to have you. Your company's had a diversified portfolio, gene therapy, cell therapy, biologics, vaccine. You're kind of, you know, running the whole gamut here. How did that happen? You know, what are some unifying characteristics you can tell us that have led to that?
You have, starting with the shared science. You take gene therapies and vaccines with adenoviral vectors, there are a lot of commonalities. There is also a manufacturing science platform with a lot of similarities. The experts or expertise, people who work in these fields, they are the same people. Who work in gene therapies, they can work on some of the vaccines, and they can also understand and develop cell therapies. This is regenerative medicine. There are a lot of common links than people probably don't see it. If you take, I mean, I'll go one by one. I think science-wise, if you're taking, you know, the delivery platform technology for gene therapies, we use adeno-associated virus. If you take vaccines, use adenovirus vector vaccines. There are commonalities.
People who work on some of these technical experts, R&D, and manufacturing scientists who have expertise in one field can definitely work another field, but they really understand it. Cell therapy is what we are working as a personalized medicine. It's very sophisticated, innovative science, and that's the same scientific minds who can work on this. Really understand how to grow, you know, it's a regenerative medicine.
With that, who's your favorite kid? You know, which of these children do you like the best?
gene therapies is very exciting platform we have. In fact, the whole Ocugen, you know, if you look at it's built on ocular space, then we diversified into vaccines and cell therapies. You know, it's very exciting platform. We believe, we're onto something phenomenal. It's a game-changing technology platform compared to existing gene therapies in the marketplace or in development. Typically with the gene therapies you got, if you have a mutation, you need to develop one product to target that. If you take a disease such as retinitis pigmentosa in ocular space we are working on and Leber congenital amaurosis, between two of them, there are about 125 genes which can get mutated. There are about 125,000 patients in U.S. alone and 1.6 million global.
There is no way pharma companies are going to develop 125, 200 products to target all this population. These are inherited retinal diseases. That means if your parents have it, most likely you will have it. Many of them do become legally blind by the time they're in mid-40s. There is a sense of urgency. What we have are like master genes in the retina. I mean, these are modifier genes. They actually control the functional network and all underlying gene expressions. Functional networks starting from cell development to inflammation to cell survival. They bring the homeostasis at the cellular level and restore the function. That's the beauty of these genes.
We believe the program we have in the clinic, OCU400 in phase I, II, currently for RP and LCA, retinitis pigmentosa and Leber congenital amaurosis, which is a broad orphan drug designation, gene-agnostic in U.S. and E.U. We believe it has potential to treat all this population with a single product. That's the difference between our platform technology compared to anything out there. The second one, which is going to target even bigger disease, age-related macular degeneration. That's 10 million patients in U.S. alone, dry AMD. The late stage is called geographic atrophy. If you take this, you know, these two genes, we believe is going to cover most of the unmet medical need in the retinal space in the back of the eye, so many blindness diseases with a potential one-time curative therapy.
That's why it really excites us to work on the gene therapies.
You wanna tell us a little more about the new kid on the block, the IND with OCU200?
Yes. This is a biological. Why there is still a need? I think people must have heard about other anti-VEGF therapies such as Eylea, Lucentis. There are some other new products coming in the marketplace. If you take diabetic macular edema, diabetic retinopathy, with age-related macular degeneration, it's a big disease burden. However, the current therapies, many of the patients, it's a significant number. I mean, some of the numbers could be 40%-50% are non-responders to existing therapies. That's where we come in. This product is a fusion protein, tumstatin-transferrin fusion protein. It targets active endothelial cells, integrin receptors, which are only present on active endothelial cells. It doesn't touch the normal cells.
We believe this has potential to be a disease-modifying drug, and it has potential to treat even non-responders in this large population. We just filed the IND in February. You know, very shortly we'll start dosing the patients.
To switch gears to vaccines, You are developing an inhalable flu vaccine, COVID-19 vaccine combination, COVID-19 and flu. How is your vaccine different from what's already out there?
The inhalation vaccine, I think, two things which we have issues with the current vaccines we have. I'm sure many of the people sitting in this room must have taken like, you know, three to five shots of the existing vaccines in the U.S. However, many of you, I'm sure, probably got infected. The current vaccines are not controlling transmission of the disease, nor they're helping with the durability. Taking shots every three months or four months, it's not practical. Transmission of the disease need to be controlled to control the pandemic. We're not out of the woods yet with COVID. This is where we come in. We have taken inhalation technology, which already showed good efficacy.
The difference between targeting mucosal vaccine, intranasal or inhalation, versus injectable systemic, you have potential to develop IgA, which are in the antibodies in the upper respiratory tract where the virus enters. You're preventing and controlling the transmission directly because you have mucosal immune responses, IgA, along with the systemic. The current vaccines lack that. Your goal is to control the transmission. These mucosal vaccines also have durability. The goal is, when we are designing this with the, you know, ChAd vector, which has potential to minimize any antibodies compared to human vector, that's what we're using, ChAd technology platform. We innovatively designed flu vaccine too, using it in our quadrivalent flu, and you got bivalent booster COVID.
The way we are designing, we're envisioning, I mean, all the experts in the field agree we need to go into annual boosters, similar to how we all get annual flu shots. That's more practical. If there is a technology out there, what we did, the inhalation technology is used by another international company, and they have good data. They launched it. Another company in India used ChAd-based technology with intranasal, and they proved that vaccine works. Inhalation, obviously, you can also reduce, based on the data available out there. I mean, at 1/5 of the IM dose, it's working. It's safe, it's efficacious. What we did, we got access to inhalation technology platform, and then we got, we believe, is the best potential in our ChAd Vector platform. We designed a flu vaccine, and we designed, COVID bivalent vaccine.
Our goal is to have these three vaccines, bivalent COVID vaccine, tetravalent flu, and a combination vaccine. We want to offer all options to anybody, you know, once we get into the marketplace. You know, if you want to just flu, you can take our flu shot. I mean flu inhalation vaccine. If you want a combination, we'll have a combination. We want to provide options for customers.
You put a decent amount of effort, thus far into COVAXIN, a very standard technology, injectable, COVID vaccine. What does all this mean? Maybe geographically, there might be a different answer. Can you elaborate on that? Because you do have it approved ex-U.S.
Yes. Yeah. COVAXIN has been approved in many countries, including WHO, used in a few hundred million people. I mean, it has got a very favorable safety data and good efficacy, durability, including memory responses. However, in U.S., because we had to do a lot of work, and so we are completing. We completed our phase II,III immunobridging trial because FDA wanted us to show demographic data in the U.S. That's why it took some time. I mean, obviously now the market is shifting to booster market because as many of the people, when you get infected, you get natural infection, you get a broad immune response. COVAXIN gives a broad immune response. If you have a base of broad immune response, you can go ahead with boosters.
We wanted to complete the study, obviously, and still a good vaccine. It is a good favorable safety. However, it does require a significant government funding in order to move forward. I mean, if you want to have multiple tools... I mean, the same thing with our inhalation vaccine. If you just stick to, you know, mRNA vaccines, you're really hindering the innovation in vaccines. That's why we really want to develop the inhalation vaccine and going to where the market is supposed to go, you know. Eventually, it'll become annual boosters. If you have a baseline as a natural infection or if you took COVAXIN, you'll have a broad immune response, so you can go with annual booster.
As far as COVAXIN is concerned, we'll complete the study, and unless, you know, there is government funding, we're going to pivot it and really focus on inhalation vaccine. The reason is, we believe there's a significant market for it. We can do a lot of good helping people, offering flu and COVID vaccine and a combination vaccine. Even let's say COVID is going to slow down and maybe five, six years from now, COVID goes away, all the effort and, you know, we have very bright scientists, and we're building this technology platform. That's why helping this innovation technology, developing a inhalation flu vaccine also will be in the long-term vaccine game, you know. One of our goals is to continue to develop vaccines to support public health perspective.
This can do a lot of good, you know, being there for long-term, one of the flu players.
where we started just saying how, you know, broad the pipeline is. You know, you don't exactly have an empty plate. can you tell us a lot more about NeoCart, but in particular, you know, why you're spending on the manufacturing of this? You know, you have a whole bunch of other stuff. Tell us, you know, competitively, where you think it's gonna make some strides and, you know, what justifies such a outlay of cash for that program?
NeoCart is another very unique program. It's for cartilage repairs. When you have lesions, if they're not treated, you can get into osteoarthritis. There are more than 1 million surgeries that are done every year, arthroscopic surgeries for cartilage repairs. The existing therapies, there is only one cell therapy product out there in the marketplace, regenerative medicine. However, you know, it's a two-day technology. We have a three-day technology, very sophisticated. You know, we have good IP, and we can take, you know, naturally we can, we have these small bioreactors. We can grow what it grows in your natural human body in a year, in like weeks, and send it back. When you have this nice three-day matrix, it has a more potential to integrate nicely when you put it.
The market size is huge. There's a lot of need. Current therapies, again, they have durability issues, they have function and pain. Those are two important things, you know. We believe having this three-day technology can integrate well. You have potential for long-term durability and also, you know, reducing your pain and improving your function with this NeoCart. It's a personalized medicine. You know, we need to take your cartilage cells, then we have to grow them and send it back to the lab, to the, you know, surgeon. This is very sophisticated technology, that's the reason we are building our own facilities because of the sophistication of science. You know, it's very difficult to work with any CMOs. You're not going to have the expertise.
We have internal expertise. Again, this capital-wise, it's more effective and efficient doing on our own. We did all the analysis, and we want to have control of our destiny, and so that's the reason. It does take time when you're building GMP facilities. We're hopeful we'll be able to finish these facilities by the end of the year. That's why, we announced we'll be in phase III clinical trial in first half of next year.
Can you help us understand, you know, where you are with cash now? Kind of what sort of fraction of that cash is going to each of these programs?
We don't give any breakdown the programs-wise, you know, how the cash is being distributed. We already announced with our K, our runway goes into first quarter of next year. Obviously, most of these programs, I mean, gene therapy programs, for example, are phase I, II. We already completed recruitment of RP patients, and we have few more patients we have to recruit under LCA. That program is going to, you know, finish up. We'll have the midyear. We're anticipating efficacy signal in next few months. Our goal is to put that program into phase III. Vaccines, obviously, we're winding it down, and we're only supporting inhalation technology platform, making the vaccine and just getting into initial clinical.
We're also closely working with, you know, various government agencies to secure funding, for our inhalation vaccine development. We're being very wise, and we're efficiently managing our capital and running all these programs, you know, doing the work, what we promised the market.
Can you help us understand what sort of competing clinical outcomes there could be coming down the pipe that could influence, you know, make you shift gears? Is there something you're really focusing on, a few things, 'cause it's a broad pipeline, there's probably more than one, you know, that you're really looking for that outcome first? Maybe it might have an impact on what you develop and how.
Yeah, absolutely. You know, when you have... You know, we have vaccines, we got gene therapies and cell therapies. You got three different platform technologies. As I mentioned before, the gene therapies have a lot of value. We actually presented it on our R&D Day, our long-term strategy last year. Those presentations are available on our website. There's a lot of value. Tremendous value and tremendous unmet medical need across the globe. We can do a lot of good with those therapies. Obviously, as an organization, when we're anticipating some efficacy signal in our phase I,II program this year, by midyear. Once we get that, remember, it's a platform technology. We got two more gene therapy programs we're planning to file for IND in the second quarter of this year.
One is targeting dry age-related macular degeneration. Huge disease burden. Second one is Stargardt disease, targeting 35,000 patients just in U.S. It's orphan disease. What does it mean? For our first program is showing efficacy signal. Remember, it's a modifier concept. We're the first company to ever do clinical trials with these kind of genes. If we prove the concept, it's working. It's working. That means the platform technology is working. That means it has far-reaching, you know, opportunities for patients.
That's why if these things come out the way we want, obviously, we want to put more emphasis on our gene therapies.Obviously, as I mentioned before, the vaccine programs take enormous amount of effort and every vaccine which got released, I mean, actually not two weeks ago, U.S. spent $32 billion about just on mRNA vaccines for COVID, right? It's a lot of effort. We do need a public-private partnerships. You don't need that kind of effort for developing, you know, inhalation flu/COVID vaccines. We need very small amount compared to that. We do anticipate some funding from the government. Otherwise, it's difficult for companies such as ours to continue to spend money on those large clinical trials.
gene therapies, they are small studies, and we really want to focus on them and because of the value, what can create for patients.
You know, I can certainly see the reason for that focus. Why don't you maybe give the audience some help in how much per patient one can charge for something curative? You know, certainly by contrast to vaccines.
Gene therapies, the pricing, based on pharmacoeconomic analysis, it's increasing. In fact, there are three gene therapy products which got approved in the last months, including one hemophilia product from CSL, and they're pricing at $3.6 million per patient. The other two are priced around, one is in $2 million, $2.7 million, I think. The third one is somewhere in low $3 million. That's the pricing. Why? If you do the pharmacoeconomic analysis, you know, it seems to be there is ICER, Institute independent analysis, and they're also justifying the pricing. Because of the, you know, the quality of life and the potential one-time curative therapies.
The pricing is enormous and so there is a significant value for shareholders too when we are working on gene therapies. From our perspective, we are so patient-centric, patients really benefit. Shareholders are going to be happy.
'Cause with something with that kind of potential, it makes a lot of sense, at least to me, to, you know, wait for that kind of data inflection before, you know, thinking about your balance sheet or anything like that. Is all of that pricing, only charging people who demonstrate benefit and free to those who took it and show no benefit? Is that common for all those products you listed, or is everybody getting, you know, paying for the treatment regardless of the benefit from gene therapy?
I mean, gene therapies are, since they say, so specialized, right? Either you're working on inherited diseases, there's a specific mutation identified, or you're demonstrating in clinical trial safety and efficacy that these group of patients benefit from it and their potential one-time curative therapies. Based on the pharmacoeconomics, you can justify that pricing. I mean, the payers, we still have a lot of work to do. Currently, the gene therapies, including recent ones, you know, you're targeting few hundred to few thousand patients. When we get into, you know, our gene therapies, our OCU400, we're targeting more than 100,000 patients in the U.S. Nobody has gone there before. When you go into our geographic atrophy, the late stage form of the dry age-related macular degeneration, that's 10 million patients in the U.S.
The late stage geographic atrophy is 1 million patients. This paradigm is going to shift. Can you charge $3 million pricing? We have to, you know. I mean, these are the things we have to do as an organization. I mean, the multiple fronts we have to work on. Once we get, you know, our signal from the efficacy, we'll continue to work on working with payers, working with CMS, and we'd like to, you know, work on a, on a plan where it's how we can get the payers to pay and because these are revolutionary therapies, and also, you know, benefiting the patients, because we do have to take care of the patients at the end of the day.
Shankar, thank you very much.
Thank you.
Bye.